Coming Corporate Control of Medicine Will Throw Patients Under the Bus

(Image: Jared Rodriguez / Truthout) One of the most effective scare techniques employed to preserve our grotesquely inefficient, overpriced health care system has been to invoke the red peril of “socialized medicine”. Never mind that foreigners in advanced economies fail to recognize the caricatures scaremongers supply, or that Americans who need emergency care while overseas are almost without exception impressed with the caliber of care and astonished by the low (sometimes no) cost to them. After all, Americans live in the best of all possible worlds,and consumer and business freedom are always better.

In fact, business freedom here increasingly means the God-given right to exploit the vulnerability of the public. The example slouching into view is more corporate control over the practice of medicine. And based on the previews, it will make the horrors falsely attributed to socialized medicine look pale.

Two accounts last week bring the issue home. The first came in the Health Care Renewal blog (hat tip Lysa). It’s a reminder of how the current institutional efforts to regiment doctors undermine the caliber of medical care. It has become distressingly common for HMOs and other medical enterprises to have business-school trained managers putting factory-style production parameters on doctor visits. Outside of foreclosure mills, it’s hard to find similar approaches in other professions.

The post describes how a pediatrician, Pauline, who has developed a reputation for treating chronic conditions is at loggerheads with her for-profit practice. The suits don’t like her patient mix. She gets too many tough cases, when they’d rather have basically healthy kids who are there for a cold or ear infection. Mind you, this is only partly a money issue. These visits can be “up coded” so as to get larger insurance/patient payments, but she get a higher level of patients in less-generous state insurance programs. But some of the pushback is that her practice is perceived as disruptive, since she uses what is perceived as too much of her and staff time, separate and apart from the economics. She’s constantly breaking management’s precious guidelines. One of her turf struggles:

She had set up a visit to see a new medically complex patient and had blocked off 40 minutes, the amount of time she felt she needed to do a good job. The child had a complex genetic disorder, cerebral palsy, and heart, lung, and kidney problems. Both the cardiologist and the nephrologist had called asking her to take this patient. She agreed. After she had scheduled the visit, a manager called her and told her that she was being allowed only 15 minutes to see that patient. After some fruitless discussion with him, Pauline finally said, “Okay, I guess that means that you’ll be seeing the patient instead of me, right?” The shocked voice at the other end of the phone line replied, “What do you mean? I don’t know how to take care of patients.” “That’s exactly my point,” Pauline put in.

Pauline explained that this manager assigned to her office is not even a college graduate. Physicians cannot access the schedule electronically and have no control over scheduling. These functions are controlled by the office manager and (amazingly) by some of the medical assistants who have received some “leadership” training. These medical assistants are even allowed to evaluate the clinical competency and skills of the physicians.

And to add insult to injury, how long did this discussion take? All those minutes the doctor spent fighting with a petty bureaucrat come at the expense of patient care.

As an aside, it’s hard to stress enough that this sort of demoralizing micromanagement an unwillingness to listen to and learn from workers, is a widespread shortcoming of management American-style. And it has weirdly been airbrushed out of the media. When I was a kid in business school, US manufacturers were having their clocks cleaned by Germans and the Japanese. There was a good deal of critical self examination back then. One source of foreign ascendancy was that they had newer factories, so you couldn’t really blame American management for that one. But the second was that it was widely acknowledged that US managers were generally poor at dealing with labor. And this wasn’t “labor” in the union sense, but at having productive relationships with factory workers (note that there has been massive revisionist history since then. When I was in Bschool, none of my classmates, nearly half of whom had worked in major manufacturing companies, had bad things to say about unions. Now you’ll often see the decline of American manufacturing attributed to unions in an “everybody knows that” tone.

Now before you come running to the defense of management against the doctor, think twice:

So let me add a further nugget about Pauline’s background. In one of her previous jobs, she was made the manager of a pediatric outpatient center within a county hospital caring for a largely indigent population. This center had been running in the red for a good while. Pauline took over and within 28 months she’d streamlined the place and had them running well in the black, while still administering a quality of care that Pauline and her colleagues could be proud of. In short, Pauline could probably tell the managers of her current practice a thing or two about how to optimize patient scheduling without compromising care or cost —if they’d listen.

As bad as that is, most patients are unware of how much their care has been fitted to a Procrustean bed. The deliberate degradation in the name of profits is going to become more obvious, at least if the health care industry has its way.

I strongly encourage you to read this post from Whole Health Chicago (hat tip Lambert) in full. It shows how the future of American medicine is to fire the ones who are unhealthy. No, I am not making that up. The writer, Dr. David Edelberg, describes a recent presentation by a large insurance company. They’ve apparently been hosting similar sessions with physicians in the Chicago area in large medical practices. Here are the key bits (emphasis original):

The speaker at these evenings is always a physician employed by the insurance company. His/her title is medical director (I begin to think there must be dozens and dozens on their payroll) and he always begins by reassuring the audience that he was in clinical practice himself so he understands something of what physicians–especially primary care physicians–are facing. I view this physician more as a “Judas steer,” the animal that leads an innocent but doomed herd of cattle through the slaughterhouse corridors to the killing floor.

• The health industry hopes that individual medical practices and small medical groups will ultimately disappear from the landscape by being financially absorbed into larger groups owned by hospital systems.

And why do the powers that be regard this as desirable? Although the article does not stress this point, doctors have an established revenue stream. So the acquirers buy them out and impose discipline on those artistic, freewheeling doctors. The “practice style,” which used to mean the independence that doctors once enjoyed, is now an Orwellianism and includes hewing to corporate guidelines as to how to operate.

And here’s what to expect:

Physicians are expected to spend a limited amount of time with each patient, and are encouraged to see as many patients as possible during a workday. The insurance companies, sometimes with the token cooperation of a few physician-employees, create vast books of patient-care guidelines to which they believe their physicians must be “accountable” (remember this word, it will crop up again). These guidelines might mean documented Pap smear and mammogram frequency, weight management and exercise, colonoscopies for patients over 50, and getting that evil LDL (bad cholesterol) below 99 by any means possible…

If the chart audit system discovers that a physician, for whatever reason, is an “outlier”–that she’s either not following the guidelines exactly or not getting the results anticipated for her patient population—she’ll be financially penalized. A quick example of what might occur: if your LDL is 115, you may be on the receiving end of a statin sales pitch from your doctor, not because bringing it down to 99 will improve your longevity, but because your refusal to do so will impact her financial bottom line.

Now of course, you might say, “Well, in fairness, medicine is too much of a cottage industry. Look at how many doctors give unnecessary annual EKGs to patients in low risk groups. How else are we going to get to evidence-based medicine?” The problem is that what we as patients will get isn’t driven by best outcomes, it’s driven by profits. Edelberg explains:

…the subtext of “standardized” always includes the unspoken “spend less money on the patient.” Thus, a doctor might be financially penalized for recommending nutritional counseling to lower cholesterol (“counseling is expensive”) instead of writing a generic statin drug (cheap). Or recommending psychotherapy (“therapy is very expensive”) instead of generic Prozac (cheaper than M&M’s). Or referring patients for massage, acupuncture, or even chiropractic (“expensive, expensive, expensive!”) instead of pushing an over-the-counter antiinflammatory (free to the insurance company, as it’s OTC).

And I shudder to think what becomes of patients who don’t hew to standard templates: the person who had a high body mass but not due to dangerous abdominal fat (which is what creates the health risk) who is pushed to take the latest, greatest diet drug. What about people who don’t buy into the religion of getting your LDL down to below 100 (one reader argued that while it may lower your risk of heart disease, it increases your all-factor death risk by reducing your ability to fight MRSA)? Will they face penalties if they fail to comply?

No, you just will find it nearly impossible to get a doctor to take you:

Let me close with a best-as-I-recall quote from an insurance company medical director. “We can no longer afford to pay for health care under the PPO model. Our plan is to phase out all fee-for-service care during the next few years. We’ll pay you doctors a finite amount of money to take care of a defined population. We tell doctors, ‘Don’t spend much money and you can keep the difference. Period. Don’t follow guidelines, and you’ll be leaving behind some serious money on the table and we’ll just take it back.’”

In case you think I overstated the implications, Edelberg recapped the discussion that ensued:

One physician piped up…. “But what about the non-compliant patients who won’t take the meds, don’t eat well, don’t have mammograms, continue to smoke? And what about super-health-conscious patients who want their vitamin levels measured and want referrals to acupuncturists?”

In other words, if you are high maintenance because you don’t do what your doctor says (and remember, “non-compliant” includes people who don’t follow orders because they think the cookie-cutter approach isn’t right for them) or want higher service or per the example of the pediatrician Patricia’s 40 minute case, have a complicated set of ailments, you’ll be shunted. The brave new world of corporate medicine will eject you.

The rich are unlikely even to know that this change is occurring. There will be a tier of doctors on the high end to cater to patients who want more personalized, cutting edge treatment and might need some prodding. And they can always go abroad if they can’t find what they need here. But for ordinary schlubs, expect to find the doctor’s office become more hostile as the brave new world of corporatized medicine becomes entrenched.

This piece was reprinted by Truthout with permission or license. It may not be reproduced in any form without permission or license from the source.

Yves Smith has been in and around finance for more than 30 years as an investment banker, management consultant to financial institutions across a large range of wholesale banking and trading markets businesses, and a corporate finance adviser. She has also written for The New York Times, Al Jazeera, the New Republic, Salon, the Conference Board Review, the Australian Financial Review and other financial publications. Her TV appearances include NBC News, CNBC, Fox Business, PBS, Bill Moyers, The Real News Network, Democracy Now!, Russia TV, ABC (Australia), Al Jazeera and BNN (Canada). Follow her on Twitter: @yvessmith.

Coming Corporate Control of Medicine Will Throw Patients Under the Bus

(Image: Jared Rodriguez / Truthout) One of the most effective scare techniques employed to preserve our grotesquely inefficient, overpriced health care system has been to invoke the red peril of “socialized medicine”. Never mind that foreigners in advanced economies fail to recognize the caricatures scaremongers supply, or that Americans who need emergency care while overseas are almost without exception impressed with the caliber of care and astonished by the low (sometimes no) cost to them. After all, Americans live in the best of all possible worlds,and consumer and business freedom are always better.

In fact, business freedom here increasingly means the God-given right to exploit the vulnerability of the public. The example slouching into view is more corporate control over the practice of medicine. And based on the previews, it will make the horrors falsely attributed to socialized medicine look pale.

Two accounts last week bring the issue home. The first came in the Health Care Renewal blog (hat tip Lysa). It’s a reminder of how the current institutional efforts to regiment doctors undermine the caliber of medical care. It has become distressingly common for HMOs and other medical enterprises to have business-school trained managers putting factory-style production parameters on doctor visits. Outside of foreclosure mills, it’s hard to find similar approaches in other professions.

The post describes how a pediatrician, Pauline, who has developed a reputation for treating chronic conditions is at loggerheads with her for-profit practice. The suits don’t like her patient mix. She gets too many tough cases, when they’d rather have basically healthy kids who are there for a cold or ear infection. Mind you, this is only partly a money issue. These visits can be “up coded” so as to get larger insurance/patient payments, but she get a higher level of patients in less-generous state insurance programs. But some of the pushback is that her practice is perceived as disruptive, since she uses what is perceived as too much of her and staff time, separate and apart from the economics. She’s constantly breaking management’s precious guidelines. One of her turf struggles:

She had set up a visit to see a new medically complex patient and had blocked off 40 minutes, the amount of time she felt she needed to do a good job. The child had a complex genetic disorder, cerebral palsy, and heart, lung, and kidney problems. Both the cardiologist and the nephrologist had called asking her to take this patient. She agreed. After she had scheduled the visit, a manager called her and told her that she was being allowed only 15 minutes to see that patient. After some fruitless discussion with him, Pauline finally said, “Okay, I guess that means that you’ll be seeing the patient instead of me, right?” The shocked voice at the other end of the phone line replied, “What do you mean? I don’t know how to take care of patients.” “That’s exactly my point,” Pauline put in.

Pauline explained that this manager assigned to her office is not even a college graduate. Physicians cannot access the schedule electronically and have no control over scheduling. These functions are controlled by the office manager and (amazingly) by some of the medical assistants who have received some “leadership” training. These medical assistants are even allowed to evaluate the clinical competency and skills of the physicians.

And to add insult to injury, how long did this discussion take? All those minutes the doctor spent fighting with a petty bureaucrat come at the expense of patient care.

As an aside, it’s hard to stress enough that this sort of demoralizing micromanagement an unwillingness to listen to and learn from workers, is a widespread shortcoming of management American-style. And it has weirdly been airbrushed out of the media. When I was a kid in business school, US manufacturers were having their clocks cleaned by Germans and the Japanese. There was a good deal of critical self examination back then. One source of foreign ascendancy was that they had newer factories, so you couldn’t really blame American management for that one. But the second was that it was widely acknowledged that US managers were generally poor at dealing with labor. And this wasn’t “labor” in the union sense, but at having productive relationships with factory workers (note that there has been massive revisionist history since then. When I was in Bschool, none of my classmates, nearly half of whom had worked in major manufacturing companies, had bad things to say about unions. Now you’ll often see the decline of American manufacturing attributed to unions in an “everybody knows that” tone.

Now before you come running to the defense of management against the doctor, think twice:

So let me add a further nugget about Pauline’s background. In one of her previous jobs, she was made the manager of a pediatric outpatient center within a county hospital caring for a largely indigent population. This center had been running in the red for a good while. Pauline took over and within 28 months she’d streamlined the place and had them running well in the black, while still administering a quality of care that Pauline and her colleagues could be proud of. In short, Pauline could probably tell the managers of her current practice a thing or two about how to optimize patient scheduling without compromising care or cost —if they’d listen.

As bad as that is, most patients are unware of how much their care has been fitted to a Procrustean bed. The deliberate degradation in the name of profits is going to become more obvious, at least if the health care industry has its way.

I strongly encourage you to read this post from Whole Health Chicago (hat tip Lambert) in full. It shows how the future of American medicine is to fire the ones who are unhealthy. No, I am not making that up. The writer, Dr. David Edelberg, describes a recent presentation by a large insurance company. They’ve apparently been hosting similar sessions with physicians in the Chicago area in large medical practices. Here are the key bits (emphasis original):

The speaker at these evenings is always a physician employed by the insurance company. His/her title is medical director (I begin to think there must be dozens and dozens on their payroll) and he always begins by reassuring the audience that he was in clinical practice himself so he understands something of what physicians–especially primary care physicians–are facing. I view this physician more as a “Judas steer,” the animal that leads an innocent but doomed herd of cattle through the slaughterhouse corridors to the killing floor.

• The health industry hopes that individual medical practices and small medical groups will ultimately disappear from the landscape by being financially absorbed into larger groups owned by hospital systems.

And why do the powers that be regard this as desirable? Although the article does not stress this point, doctors have an established revenue stream. So the acquirers buy them out and impose discipline on those artistic, freewheeling doctors. The “practice style,” which used to mean the independence that doctors once enjoyed, is now an Orwellianism and includes hewing to corporate guidelines as to how to operate.

And here’s what to expect:

Physicians are expected to spend a limited amount of time with each patient, and are encouraged to see as many patients as possible during a workday. The insurance companies, sometimes with the token cooperation of a few physician-employees, create vast books of patient-care guidelines to which they believe their physicians must be “accountable” (remember this word, it will crop up again). These guidelines might mean documented Pap smear and mammogram frequency, weight management and exercise, colonoscopies for patients over 50, and getting that evil LDL (bad cholesterol) below 99 by any means possible…

If the chart audit system discovers that a physician, for whatever reason, is an “outlier”–that she’s either not following the guidelines exactly or not getting the results anticipated for her patient population—she’ll be financially penalized. A quick example of what might occur: if your LDL is 115, you may be on the receiving end of a statin sales pitch from your doctor, not because bringing it down to 99 will improve your longevity, but because your refusal to do so will impact her financial bottom line.

Now of course, you might say, “Well, in fairness, medicine is too much of a cottage industry. Look at how many doctors give unnecessary annual EKGs to patients in low risk groups. How else are we going to get to evidence-based medicine?” The problem is that what we as patients will get isn’t driven by best outcomes, it’s driven by profits. Edelberg explains:

…the subtext of “standardized” always includes the unspoken “spend less money on the patient.” Thus, a doctor might be financially penalized for recommending nutritional counseling to lower cholesterol (“counseling is expensive”) instead of writing a generic statin drug (cheap). Or recommending psychotherapy (“therapy is very expensive”) instead of generic Prozac (cheaper than M&M’s). Or referring patients for massage, acupuncture, or even chiropractic (“expensive, expensive, expensive!”) instead of pushing an over-the-counter antiinflammatory (free to the insurance company, as it’s OTC).

And I shudder to think what becomes of patients who don’t hew to standard templates: the person who had a high body mass but not due to dangerous abdominal fat (which is what creates the health risk) who is pushed to take the latest, greatest diet drug. What about people who don’t buy into the religion of getting your LDL down to below 100 (one reader argued that while it may lower your risk of heart disease, it increases your all-factor death risk by reducing your ability to fight MRSA)? Will they face penalties if they fail to comply?

No, you just will find it nearly impossible to get a doctor to take you:

Let me close with a best-as-I-recall quote from an insurance company medical director. “We can no longer afford to pay for health care under the PPO model. Our plan is to phase out all fee-for-service care during the next few years. We’ll pay you doctors a finite amount of money to take care of a defined population. We tell doctors, ‘Don’t spend much money and you can keep the difference. Period. Don’t follow guidelines, and you’ll be leaving behind some serious money on the table and we’ll just take it back.’”

In case you think I overstated the implications, Edelberg recapped the discussion that ensued:

One physician piped up…. “But what about the non-compliant patients who won’t take the meds, don’t eat well, don’t have mammograms, continue to smoke? And what about super-health-conscious patients who want their vitamin levels measured and want referrals to acupuncturists?”

In other words, if you are high maintenance because you don’t do what your doctor says (and remember, “non-compliant” includes people who don’t follow orders because they think the cookie-cutter approach isn’t right for them) or want higher service or per the example of the pediatrician Patricia’s 40 minute case, have a complicated set of ailments, you’ll be shunted. The brave new world of corporate medicine will eject you.

The rich are unlikely even to know that this change is occurring. There will be a tier of doctors on the high end to cater to patients who want more personalized, cutting edge treatment and might need some prodding. And they can always go abroad if they can’t find what they need here. But for ordinary schlubs, expect to find the doctor’s office become more hostile as the brave new world of corporatized medicine becomes entrenched.

This piece was reprinted by Truthout with permission or license. It may not be reproduced in any form without permission or license from the source.

Yves Smith has been in and around finance for more than 30 years as an investment banker, management consultant to financial institutions across a large range of wholesale banking and trading markets businesses, and a corporate finance adviser. She has also written for The New York Times, Al Jazeera, the New Republic, Salon, the Conference Board Review, the Australian Financial Review and other financial publications. Her TV appearances include NBC News, CNBC, Fox Business, PBS, Bill Moyers, The Real News Network, Democracy Now!, Russia TV, ABC (Australia), Al Jazeera and BNN (Canada). Follow her on Twitter: @yvessmith.